The Impact of the Right Business Services Vehicle Program

Is your business services vehicle program benefitting your company?

Whether or not your business services vehicle program works for you, you know the industry is a catch all. It includes companies as similar as marketing and advertising firms, or as different as cleaning services and security systems. They’re tied together by one simple fact. They provide services to companies in need. That’s where the similarities end.

Or is it? Business services companies need to sell these services and provide said services as requested. These needs require sales associates, consultants and other company employees to travel for work in their day-to-day. And where there’s business travel, there’s need for a vehicle program. So there’s similarity number two! But is your current business services vehicle program the right one? We’ll go over each business vehicle program, from their benefits to their drawbacks and best fits.

My specific business service hasn’t been mentioned. Does this information apply to me?

In short, yes. Business services may vary greatly, but they all need people to travel for their company. The type and size of company has a big impact on what vehicle program fits best, so we’ll cover each of the most popular options.

Company Car

Your company owns or leases a fleet of vehicles that your mobile workforce uses for their business travel. This vehicle program is common with companies that require specialty vehicles or offer fleet vehicles as a recruiting perk. It is also generally paired with a fuel card. Companies can charge their employees a personal use fee for non-business-related travel.

Benefits:
  • The vehicle can be leveraged in recruitment
  • Control of company image
Disadvantages:
  • Increased cost of vehicles
  • Covering maintenance costs on fleet vehicles
  • Increased company liability (when a mobile worker is found at fault in an accident, the company will be sued)

Best for companies with utility vehicles: waste product services, equipment providers, etc.

Flat Car Allowance

Your company provides your mobile workforce with a flat rate each month. This rate is to cover the costs of mobile workers driving their vehicle for work. This vehicle program is common with companies that want to handle reimbursements with ease.

Benefits:
  • Easy to implement
  • Everyone receives the same amount
Disadvantages:
  • The reimbursement is not fair to mobile workers who travel more than others.
  • If the flat amount does not reimburse them adequately, your company may risk violating labor laws.
  • Flat allowances are taxable. Companies will spend more and mobile workers will receive less.

Best for companies that have funds to burn on taxes.

Cents-Per-Mile

Your company provides your mobile workforce with a cent-per-mile reimbursement for their business-related driving. This vehicle program is common with many companies in the business services industry.

Benefits:
  • Employees receive tax free reimbursements for miles traveled
  • Option to automate mileage tracking
Disadvantages:
  • Reimbursements do not take into account geographic differences in prices
  • Manual mileage logs decrease productivity, expose company to potential mileage fraud

Best for businesses whose mobile workforce (consultants, sales associates, technicians, etc) drive under 5,000 miles each month.

Fixed and Variable Rate

Your company provides your mobile workforce with a reimbursement based on both the fixed costs (fixed costs) and variable costs (variable costs). This vehicle program is common with companies that prioritize staying flexible during any economy.

Benefits:
  • Companies have flexibility over their vehicle program spend
  • Mobile workers
    • receive fair and accurate reimbursement
    • can automate their mileage tracking
    • can submit their mileage easily from any location
Disadvantages:
  • Implementation and training for mobile workforce

Best for businesses looking to boost productivity, control costs and reimburse their mobile workforce accurately.

Hybrid Program

Business services companies are not always suited for one vehicle program. But you don’t have to sacrifice the benefits of one by committing to another. With a hybrid vehicle program, companies can implement the best options as they apply to their mobile workforce.

Room for Improvement

The right business services vehicle program does more than enable your mobile workforce to travel for business. Your vehicle program can also boost productivity. How? By removing administrative work and replacing it with accurate automation. Less time calculating and submitting mileage means more time working with current and prospective clients.

The right vehicle program for your business services company can also be an effective cost control method. Switching from the needless expenses of flat allowance and company vehicle programs to more financially responsible options means dropping big numbers from your company’s travel and expense budget. Even implementing automated mileage tracking in your current program can result in a significant decrease in spend.

Business Services may be a catch all term that can’t define your company’s specific concerns. But your need for a mobile workforce puts you in a similar position to many other companies that help businesses. Is the vehicle program you currently have the best for your company or its mobile workforce? Exploring your other options may have helped you realize there’s a better alternative. Ready to see how your vehicle program can be improved? Talk to us.

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The Author

Ben Reiland

Ben Reiland is a Content and SEO Specialist with Motus, LLC. Keeping an eye out for industry impacts and staying on top of trends, Ben's expertise ranges from verticals and labor laws to oil price impacts and more!

Read more by Ben Reiland

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